RealWebFunds helps developers and investors find
financing for construction of single-family residential homes as well as residential land
acquisition and development financing. By presenting your loan request to local, regional and
national construction lenders we are able to find the best financing available for just about
any size and shape of project.
| Note: These are not terms of any specific lender. They represent terms that
we frequently see in the marketplace and are not to be relied on as a commitment to provide
any specific terms for any specific deal. |
| Structure: |
Generally these are lines of credit that are funded as costs are incurred and repaid as
houses or lots are sold. |
| Maximum loan to cost: |
80% to 90% |
| Maximum loan to value: |
70% to 80% of completed value |
| Term: |
Generally 1 to 2 years with extensions as necessary |
| Amortization: |
Interest only |
| Typical Rates: |
Prime plus 0.5% to 2.0% or LIBOR plus 3.0% to 4.0%
|
| Developer Experience: |
Developer and contractor
must have experience at this type and scale of development. |
| Release Clause: |
As lots or houses are sold the developer will pay back 75% to 85% of the proceeds to
the lender and the lender will release this asset from the collateral. |
| Recourse: |
Typically these loans are recourse.
|
| Closing costs: |
Borrowers are responsible for all due diligence and closings costs (e.g. Appraisal, Phase 1 Environmental, site inspection, title, etc)
- Loans under $3M - costs range from $6,000 to $12,000
- For loans over $3M - costs can be $20,000 or more
Most construction lenders also charge a 1% loan fee.
|
